A country ensures national currency usage by requiring tax payments in that currency
Is it true that a country ensures national currency usage by requiring tax payments in that currency?
Yes. Governments drive the demand and usage for their national currency by establishing tax liabilities that must be settled in that specific currency.
Verdict: SUPPORTED · 3 sources for, 0 against · Last checked
The retrieved papers, particularly literature surrounding Modern Monetary Theory and empirical studies on fiat money demand (such as [3]), explicitly support the foundational economic concept that a state ensures the usage of its currency by requiring taxes to be paid in it. There is no contradictory evidence in the provided sources.
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Wray, L. R. (2020). Sovereign Currency and Non‐Sovereign Budgets: The Modern Money Theory Approach. doi.org. https://doi.org/10.1111/pbaf.12251
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Wray, R. & Marx, K. (2019). Fiscal Reform to Benefit State and Local Governments: The Modern Money Theory Approach. doi.org. https://doi.org/10.2139/ssrn.3448084
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Ott, M. & Tatom, J. A. (2015). Government Finance and the Demand for Money—The Relation between Taxation and the Acceptability of Fiat Money. doi.org. https://doi.org/10.1111/ecno.12048
What does the evidence say?
The retrieved papers, particularly literature surrounding Modern Monetary Theory and empirical studies on fiat money demand (such as [3]), explicitly support the foundational economic concept that a state ensures the usage of its currency by requiring taxes to be paid in it. There is no contradictory evidence in the provided sources.
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